Latest news with #LogicConsulting
Al Etihad
25-05-2025
- Business
- Al Etihad
UAE retail set to reach $162b by 2028, leads GCC in e-commerce: Report
25 May 2025 23:10 KHALED AL KHAWALDEH (ABU DHABI) The UAE's retail market is forecast to reach $162 billion by 2028, growing at an average annual rate of over 5% from $127.2 billion in 2023, according to a new report by Logic Consulting. According to the Middle East-based group, the UAE leads the region in innovation, digitalisation, and sophisticated e-commerce offerings, despite having a smaller market than neighbouring Saudi Arabia. Titled "Revolutionising Retail: Unveiling GCC's Five-Year Transformation", the study positions the UAE as the most digitally advanced retail market in the GCC.E-commerce sales, which reached $3.9 billion in 2020, growing more than 50% year on year, are expected to become increasingly dominant. According to Logic, this is reflected in consumer preference, with 69% of UAE shoppers saying their loyalty increased for brands that allowed them to shop online and return-in-store. "As GCC nations continue to transition away from oil dependency, retail has become a key enabler for fostering domestic consumption, attracting private investment, and catalysing the development of adjacent industries, including logistics, real estate, technology, and tourism," the report said. The report outlines how major UAE-based retailers are leading the charge, using big data and AI to forecast demand, reduce waste, and personalise consumer journeys. Innovations such as click-and-collect, virtual fitting rooms, and loyalty-integrated apps are becoming the includes success stories from the likes of Majid Al Futtaim, Lulu Hypermarkets, and Noon – with many offering expanded services, same-day delivery, and increasingly competitive ways to shop, and receive items on demand. Moreover, the report details the rising appetite for luxury items and notes the UAE's leading role as a luxury hub in the region. According to Logic, approximately 70% of consumers in the GCC report increased spending on luxury items. "The UAE hosts a substantial number of high-net-worth individuals and millennials who drive the demand for luxury goods and immersive shopping experiences. This cohort values exclusivity, personalised services, and innovative retail environments," the report said. "'Phygital' experiences cater to their desire for interactive and seamless shopping journeys. For instance, luxury brands in the region are adopting augmented reality (AR) and virtual reality (VR) to enhance customer engagement and provide unique in-store experiences." Despite rapid changes in the retail landscape, traditional neighbourhood shops – namely the 10,000 or so Baqalas on street corners – remain dominant in the UAE's grocery retail sector. A Kantar Worldpanel study cited by Logic shows that these stores continue to make up 60% of shopper traffic.
Khaleej Times
22-05-2025
- Business
- Khaleej Times
GCC retail sector set to hit $390b by 2028, fuelled by digital innovation
The GCC retail industry is on track to reach $390 billion by 2028, propelled by digital transformation, evolving consumer preferences, and strategic government initiatives. Once anchored in traditional brick-and-mortar models, the sector is now a dynamic driver of economic diversification, technological advancement, and consumer-centric growth, positioning the GCC as a global retail innovator, according to a recent report by Logic Consulting. The retail landscape in the GCC is undergoing a profound shift, with 87 per cent of consumers embracing a 'phygital' blend of online and offline purchasing channels, says the report titled 'Revolutionising Retail: Unveiling GCC's Five-Year Transformation'. Shoppers, increasingly digitally fluent and time-sensitive, demand seamless, personalised experiences. This evolution is reshaping retail into a cornerstone of national development, spurring investment in logistics, real estate, and tourism. 'Retail is no longer just transactional; it's a catalyst for economic ecosystems,' noted Haitham Rabie, a lead analyst at Logic Consulting. The GCC's retail market is divided into food and non-food segments, each exhibiting robust growth. Food retail, valued at $127.2 billion in 2023, is projected to reach $162 billion by 2028, driven by urbanisation and changing dietary habits. Non-food retail, encompassing luxury goods, electronics, and fashion, is growing faster with a compound annual growth rate (CAGR) of 6.2 per cent, expected to hit $243.6 billion by 2028. Saudi Arabia and the UAE dominate, accounting for over 75 per cent of regional retail sales, a share set to expand further. Digital innovation is at the heart of this transformation. The rise of quick commerce — ultra-fast delivery within 30 minutes — is redefining consumer access to essentials. Digital-first platforms like Noon and are challenging traditional giants such as Carrefour and Lulu, which are integrating artificial intelligence (AI), live inventory tracking, and omnichannel logistics to stay competitive. AI-driven personalisation and predictive analytics are enhancing e-commerce, creating tailored shopping journeys that resonate with tech-savvy consumers. Physical retail is also evolving. The GCC is expected to add nearly four million square metres of retail space by 2028, but the focus is shifting beyond scale to experiential shopping. Augmented reality try-ons, interactive store designs, and micro-fulfillment centers are becoming standard, blending physical and digital realms. 'Retailers aren't just selling products; they're curating immersive journeys,' Rabie emphasised. A notable trend is the rise of value-driven and sustainable retail. While luxury remains a stronghold, private labels and budget-friendly chains are gaining traction among the growing middle class and price-conscious shoppers. Concurrently, over 50 per cent of GCC consumers now prioritise eco-friendly brands, pushing retailers to adopt sustainable practices. For instance, UAE-based retailer Majid Al Futtaim reported in 2024 that 60 per cent of its customers favored brands with clear environmental commitments, reflecting a regional shift toward purpose-driven consumption. To thrive, retailers must adapt strategically. Logic Consulting outlines five imperatives: crafting a unique selling proposition in a crowded digital market, embracing lean operations and data-driven supply chains, preparing for market consolidation, forging innovative partnerships, and tailoring offerings to local dynamics. These strategies are critical as the GCC retail sector navigates intense competition and rapid technological change. The GCC's retail boom is bolstered by government initiatives, such as Saudi Arabia's Vision 2030 and the UAE's Projects of the 50, which promote private investment and economic diversification. With a young, affluent, and tech-savvy population — over 60 per cent of the GCC's 56 million residents are under 30 — the region is emerging as a global retail hub. 'The GCC isn't just following global trends; it's shaping them,' Rabie said. As the sector reinvents itself, its trajectory will define the region's post-oil economic future, setting a benchmark for innovation and growth.
